A number of payment methods and systems exist. For example, a buyer may present a credit card to a merchant, who can “swipe” the credit card and receive payment from a bank associated with the credit card. This method has many advantages, including enhanced fraud detection and security. However, the credit card (or the card number and security codes) must first be presented to the merchant before transaction processing can occur. Thus, the merchant and any merchant-related banks must be involved in a transaction from the beginning, even when such transaction is not completed. Furthermore, the buyer cannot easily schedule when the payments will be transferred to the merchant.
Other payment methods exist, such as checks, the use of automated clearing house (ACH) systems, wire transfers, etc. These methods are advantageous in that the merchant does not need to be involved in the processing of the transaction, as with a credit card transaction. However, the transaction methods are limited. For example, they do not provide for enhanced risk assessment or rewards programs for the buyer or merchant. Wire transfers can be troublesome to execute, and the timing and amounts transferable are limited. Checks may take a while to be cashed by the recipient. During such time, the buyer will not be able to know the status of the check, or when the funds will be drawn from the buyer's account. Furthermore, there are the inherent dangers of lost or stolen checks.
Embodiments of the invention address the above-noted problems, and other problems, individually and collectively.